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A

Academic Year: One complete school year at the same school or two complete half-years at different schools. For schools with a year-round program, nine months is considered an academic year. Academic years start in the fall term and end at the end of the summer term.

Acceleration of Loan Repayment: The demand for immediate repayment of the entire outstanding balance of a loan.

Aid for Military Personnel: Money offered by the federal government and nonprofit organizations for college to veterans, future military personnel, active-duty personnel, or those related to veterans or active-duty personnel.

Alternative Documentation of Income (ADOI): Proof of all current income provided when applying for an income-driven repayment (IDR) plan, especially when not providing a federal tax return or tax transcript.

Annual Taxable Income: The amount of income used to determine tax liability in a given year, including wages, salaries, bonuses, tips, investment income, and unearned income.

Award Year: The academic year for which financial aid funds a student’s education.

C

Capitalization of Loan Interest: The addition of unpaid accrued interest to the principal balance of a loan, increasing monthly payments over time.

Cookies (Web Technology): Bits of data transferred to a computer's hard drive by a website for purposes such as determining personal preferences.

Credit: The amount of money one is able to borrow for purchasing goods and services, subject to repayment agreements.

D

Debt Collection: The pursuit of payments for loan debts due by borrowers.

Debt Consolidation: A method of debt refinancing involving taking out one loan to pay off others.

Debt Recovery Entity: An entity recovering unpaid debt from borrowers who have defaulted on their loans. Also known as collections.

Defaulted Federal Student Loan Charges: Expenses charged on defaulted federal student loans that are added to the outstanding principal balance.

Defaulted Student Loan: Occurs when a loan isn't repaid per the promissory note, often after 270 days, leading to legal consequences and loss of federal student aid eligibility.

Deferment of Loan Payments: Temporary postponement of loan payments under specific conditions, during which interest doesn’t accrue on subsidized loans.

Direct Loan Program: Federal student loan program where eligible students borrow directly from the U.S. Department of Education.

Direct PLUS Loans: Federal loans for graduate or professional students and parents of dependent undergraduates to help cover education expenses.

Direct Subsidized Loan: A federal student loan with the government paying interest while the borrower is in an in-school, grace, or deferment period.

Discretionary Income: The difference between annual income and a percentage of the poverty guideline, used in certain loan repayment plans and rehabilitation.

E

Early Action in College Admissions: A non-binding college admission policy allowing early application and admission notice without a binding agreement.

Early Decision in College Admissions: A binding college admission policy where applicants commit to attending if accepted.

Educational Service Agency: A regional public multiservice agency authorized to develop, manage, and provide services or programs to local education agencies.

Eligible Program: A program of organized instruction leading to an academic, professional, or vocational degree or certificate.

Emancipated Minor: Someone legally deemed an adult by a court in their state, considered independent for FAFSA® reporting.

Endorser for Direct PLUS Loan: Someone agreeing to repay the loan if the borrower defaults. Not the student for whom the parent obtains the loan.

Endorser Code for Direct PLUS Loan: Used to complete a Direct PLUS Loan addendum to the Master Promissory Note.

Enrollment Status: Reported by the school, indicating whether a student is or was full-time, half-time, etc.

Entrance Counseling: Mandatory counseling that explains borrower rights and obligations for first-time Direct Loan borrowers.

Exit Counseling: Required counseling that provides important information for federal student loan borrowers preparing to repay their loans.

Extended Repayment Plan: Allows repayment over an extended period, up to 25 years, with specific eligibility requirements.

F

Federal Family Education Loan (FFEL) Program: A program that worked with private lenders, ended in 2010, replaced by the Direct Loan Program.

Federal Student Aid: Assistance from the government in the form of grants, loans, and work-study for college or career school at both the undergraduate and graduate educational levels.

Federal Supplemental Educational Opportunity Grant (FSEOG): A grant for undergraduates demonstrating exceptional financial need.

Federal Work-Study: A program providing the opportunity to get funding from part-time jobs for students with financial need.

Financial Aid: Money to help fund college or career school.

Forbearance: Temporarily stops or reduces monthly student loan payments. Contact the loan servicer to request forbearance.

FSA ID: A username and password for accessing the U.S. Department of Education’s online systems, serving as a legal signature.

G

Graduate or Professional Student: Pursuing education beyond an undergraduate degree.

Graduated Repayment Plan: A repayment plan with lower payments initially, increasing every two years over a period.

Graduation Rate: The percentage of students completing their degree or certificate within 150% of the published program length.

Grant: A monetary gift for higher education, often based on financial need and not requiring repayment.

Gross Income: Total annual income before deductions and taxes.

Guaranty Agency: A state or private non-profit agency assisting in administering the FFEL Program, insuring federal loans and collecting defaulted loans.

H

Half-Time Enrollment: An enrollment status for students enrolled in half of the expected credits for a full course load.

Head of Household for Tax Purposes: A tax filing status for individuals providing more than half the cost of keeping up their home.

Homeless Individual Eligibility: Special considerations for federal student aid eligibility for homeless individuals.

I

Independent Student (2023–24): A student considered independent on the FAFSA® based on specific criteria.

Interest on Loans: The cost of borrowing money, added to the loan balance.

Iraq and Afghanistan Service Grant (IASG): A grant for students who lost a parent or guardian in military service in Iraq or Afghanistan.

J

Job Placement Rate: The percentage of graduates employed in their field within a specified period.

Judgment Lien and Federal Student Aid: Legal claims impacting federal student aid eligibility.

L

Legal Guardianship: A court-authorized designation allowing someone to care for an individual, qualifying them as an independent student.

Lender: The organization that made the loan, such as the borrower’s school, bank, or credit union.

Litigation in Student Loans: The process of bringing or contesting legal actions related to student loans.

Loan: Borrowed money that must be repaid with interest.

Loan Discharge: The removal of a borrower’s obligation to repay some or all of a loan under specific circumstances.

Loan Eligibility Criteria: Requirements students must meet to qualify for a specific loan program.

Loan Rehabilitation: A process to remove the default status of a student loan through consecutive, on-time payments.

Loan Repayment: The act of repaying borrowed money, usually in monthly installments.

M

Master Promissory Note (MPN): A legal document containing borrower rights and conditions for loan repayment.

Merit-Based Aid: Financial aid based on a student's skill or ability.

N

No Outstanding Loan Balance Requirement: No outstanding balance on a Direct Loan or FFEL Program loan when receiving a new loan.

Non-Tenure-Track Employment: Work performed by adjunct, contingent, or part-time faculty at institutions of higher education.

O

Offset: A reduction or stoppage of a payment (e.g., income tax refund) to pay off a delinquent debt.

Ombudsman Group: A group dedicated to helping resolve disputes related to federal student aid programs and institutions.

Out-of-State Student: A student attending a college or career school outside their state of legal residence.

P

Partial Financial Hardship: An eligibility requirement under certain loan repayment plans.

Pay As You Earn Plan: A repayment plan with monthly payments based on discretionary income.

Payroll Deductions: Amounts withheld from a paycheck by an employer.

Pell Grant: The largest federal grant program for undergraduates, assisting those from low-income households.

Perkins Loan: A subsidized loan available until Sept. 30, 2017, for undergraduate, graduate, and professional students.

PLUS Credit Counseling: Counseling for understanding obligations associated with borrowing a PLUS loan.

Postbaccalaureate Teacher Certification Program: A program enabling those with a bachelor's degree to earn teacher certification.

Prepaid Tuition Plan: A plan letting individuals lock in future tuition rates at current prices.

Principal of the Loan: The sum of money lent on which interest is paid.

Proprietary School: A private, for-profit school providing education and training.

Public Service Loan Forgiveness (PSLF) Help Tool: This tool assists in understanding the requirements of the PSLF Program, employer eligibility, qualifying loans, and necessary actions.

PSLF Program: Forgives the remaining balance on Direct Loans after 120 qualifying monthly payments (10 years) under a qualifying repayment plan while working full-time for a qualifying employer.

R

Regular Student: Enrolled or accepted for enrollment at an institution for the purpose of obtaining a degree, certificate, or other recognized education credential.

Retention Rate: The percentage of students returning for subsequent academic years.

Room and Board Costs: The costs associated with housing and meals while attending an educational institution.

S

Satisfactory Academic Progress: Standards set by schools to ensure students progress academically while receiving